The January 2025 Wall Street Journal Economic Forecast Survey

The January 2025 Wall Street Journal Economic Forecast Survey was published on January 19, 2025. The headline is “Trump’s Return Nudges Economists’ Inflation Outlook Higher.”

I found numerous items to be notable – although I don’t necessarily agree with them – both within the article and in the forecasts section.

An excerpt:

Economists are starting to model the effects of President-elect Donald Trump’s plans to raise tariffs, cut taxes and restrict immigration. The upshot: Inflation and interest rates are likely to be higher for at least the next two years than forecasters anticipated before the election.

As seen in the “Recession Probability” section, the average response as to whether the economy will be in a recession within the next 12 months was 22%. The individual estimates, of those who responded, ranged from 1% to 65%.  For reference, the average response in October’s survey [the previously published survey] was 26%.

As stated in the article, the survey’s 73 respondents were academic, financial and business economists.  The survey was conducted January 10 – January 14. Not every economist answered every question.

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Economic Forecasts

The current average forecasts among economists polled include the following:

GDP:

full-year 2024:  2.54%

full-year 2025:  2.00%

full-year 2026:  2.00%

full-year 2027:  2.04%

Unemployment Rate:

December 2025: 4.26%

December 2026: 4.19%

December 2027: 4.14%

10-Year Treasury Yield:

December 2025: 4.40%

December 2026: 4.25%

December 2027: 4.15%

CPI:

December 2025:  2.69%

December 2026:  2.57%

December 2027:  2.32%

Core PCE:

full-year 2024:  2.78%

full-year 2025:  2.55%

full-year 2026:  2.39%

full-year 2027:  2.24%

(note: I have highlighted this WSJ Economic Forecast survey each time it is published; it was published monthly until April 2021, after which the survey is conducted (at least) every three months; commentary on past surveys can be found under the “Economic Forecasts” label)

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I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site are aware, I do not necessarily agree with many of the consensus estimates and much of the commentary in these forecast surveys.

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 5996.66 as this post is written